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The African Development Bank Group released its Annual Report for 2023 on Wednesday, painting a picture of improved financial performance and robust support to its member countries across Africa.
The critical financial support has resulted in increased resilience and recovery despite the challenging effects of regional conflicts, economic shocks, climate change, and the after-effects of the Covid-19 pandemic.
In the face of stubbornly high inflation, public debt and associated financial vulnerabilities, African countries balanced efforts to spur growth and measures to contain the impact of rising cost of living on their citizens, earning commendation from Bank Group president Dr. Akinwumi Adesina.
“Our nations, our economies, and our people continue to show remarkable fortitude,” he noted in the report’s foreword. “Despite the overall economic slowdown, 15 countries posted output expansion of more than 5 percent and Africa retained its position as the fastest-growing economy after Asia with real GDP growth close to the global average of 3.2 percent.”
The Annual Report reports that Bank Group approvals for 2023 (UA 8.03 billion) were 30 percent higher than those for 2022 (UA 6.16 billion), and close to the highest approvals in the history of the Bank Group.
Approvals for sovereign operations - projects financed with the guarantee of a sovereign entity such as a national or sub-national government - in 2023 increased sharply by 43%, to reach UA 6.76 billion as the Bank provided extensive sustainable finance to boost several African countries in their post Covid-19 recovery.
The Bank’s High 5 priorities: to Light Up and Power Africa, Feed Africa, Industrialize Africa, Integrate Africa, and Improve the Quality of Life for the People of Africa all saw increased approvals in 2023, except “Feed Africa,” which showed a decrease. The positive decrease from the exceptionally high level in 2022, is a result of the newly created African Emergency Food Production Facility (https://apo-opa.co/3VqIFmH), set up to offset disruption of food supplies across the continent due to Russia’s invasion of Ukraine.
The report records the impressive results of projects delivered across the High 5’s in 2023: 2.4 million people with access to new electricity connections; 11 million farmers used improved techniques including micro-irrigation, fertilizer, and climate-resilient seeds; over 440,000 enterprises had access to finance, and almost 233,000 of them are women-owned, 3.5 million people gained access to better transport services; and 9 million people had new or improved access to water and sanitation.
Bank maintains gender markers, pursuing innovative financing solutions to offset risk
The African Development Bank continued to categorize its approved sovereign operations using the Gender Marker System, which seeks to differentiate operations to focus on those that have a greater impact on reducing gender gaps.
In 2023 a record 100% of sovereign operations were categorized using the Gender Marker System, of which 58% contributed directly to women’s access to social services and skills.
The Bank showed innovation in safeguarding its ability to bear risk in carrying out its strategic development objectives while maintaining its AAA/aaa rating. In particular, guarantees for sovereign operations rose to UA 1.71 billion in 2023, the highest level since the Bank started offering these instruments in 2000.
Also in 2023, approvals for climate finance registered substantial increase over 2022, reaching UA 4.3 billion (USD 5.8 billion,) representing 55% of total approvals.
The African Development Bank Group experienced a significant increase in income in all its three entities reaching UA 1,729.89 million up from UA 774.79 million in December 2022. The increase was a result of heightened loan activities and favorable returns on treasury and other investments. Although, this was largely offset by higher borrowing expenses, the Bank achieved very strong net income of UA 406.05 million, close to double the UA 239.39 million in 2022.
The African Development Fund, the group’s concessional lending arm, saw the largest increase in income, totaling UA 332.82 million, up from UA 151.74 million in December 2022, marking its largest surplus (UA 115.27 million) in the past 20 years.
The Bank Group also demonstrated its capacity to deliver while prioritizing governance, reform, compliance and accountability. In 2023, it reached 95% completion of the implementation of its Integrated Quality Assurance Plan aimed at enhancing the quality of its operations to increase its development impact. The Annual Development Effectiveness 2023 Review reports that the Bank Group has continued to achieve significant results in its High 5 priority areas.
In another measure of its performance the ratings of the Bank’s senior debt (AAA/Aaa) were reaffirmed with a stable outlook by all four leading international rating agencies. “These high credit ratings reflect the Bank’s solid capital adequacy, robust risk management, prudent financial management, very high liquidity coverage, excellent funding record, preferred creditor status, and very strong shareholder support,” the report noted.
To learn more about the 2022 Annual report, click here
Distributed by APO Group on behalf of African Development Bank Group (AfDB).
Contact:
Amba Mpoke-Bigg
Communication and External Relations Department
email: media@afdb.org
About the African Development Bank Group:
The African Development Bank Group (AfDB) is Africa’s premier development finance institution. It comprises three distinct entities: the African Development Bank (AfDB), the African Development Fund (ADF) and the Nigeria Trust Fund (NTF). On the ground in 37 African countries with an external office in Japan, the AfDB contributes to the economic development and the social progress of its 54 regional member states. For more information: www.AfDB.org
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